US presses on state firms in Pacific trade talks

The United States said Sunday it wanted rules on state-owned enterprises as part of a Pacific free trade agreement, but acknowledged differences in negotiations on crafting the ambitious deal.

Negotiators from the United States and eight other nations were holding talks in Dallas, Texas, on the Trans-Pacific Partnership, which advocates hope will form the basis for a sweeping free trade pact across the dynamic region.

The United States submitted a proposal to ensure guidelines on state-owned enterprises, saying that such firms should not “undermine the benefits of the agreement,” a US official told reporters on condition of anonymity.

“This is a priority for us. We think this is an important issue to address. It is important to ensure that companies operating have a level playing field.”

The official acknowledged “sensitivities” on the issue and that “quite a bit of discussion” ahead.

“We are going to have to work with the countries around the table to try to come up with an approach that’s going to work out for everyone,” she added.

Nations in the Trans-Pacific Partnership talks include Vietnam, a communist state where many key enterprises remain government-run, and Singapore, where the major investment firm Temasek Holdings is linked to the state.

The other countries in the talks are Australia, Brunei, Chile, Malaysia, New Zealand and Peru.

The US official said that the latest round of talks produced “excellent progress” and that a number of issues were “within striking distance” but declined to give specifics or a timeline. President Barack Obama has voiced hope for finishing the deal this year, but few consider the goal realistic.

The negotiators talked about letting new members into the Trans-Pacific Partnership talks. Canada, Japan and Mexico have voiced interest, but the issue is deeply controversial in Japan, where farm groups have accused Prime Minister Yoshihiko Noda of sacrificing their interests.

The Obama administration has billed the Trans-Pacific Partnership as a “21st century” trade deal that considers barriers other than tariffs and ensures labor and environmental standards. Negotiators are meeting in Dallas with non-governmental groups in hopes of explaining their positions.

Critics say the talks lack transparency and promote business interests at the expense of consumers. Some US lawmakers want dairy excluded, fearing that New Zealand would crush the US sector, while Australian activists have voiced fear that US pharmaceutical companies will force a hike in medicine prices.

The Dallas talks — the 12th round on the Trans-Pacific Partnership — opened Wednesday and run until the end of this week. The US official said that ministers will talk about the trade deal next month on the sidelines of a meeting in Kazan, Russia, of the Asia-Pacific Economic Cooperation forum.